Child has £2100 earnng 5% can she do better

SuperMum2008

Hi there, my daughter has £2100 in a savings account earning 5% tax free. Can she do better? Should I start a pension for her instead or could I put it in an isa?

CLAPTON

depends

whats the money for?
is the money in her name ?
did the money come from her parents ?
she must be 16 before she can have an ISA
shw will not be able to withdraw anything from a pension until she is 55


but 5% can be beated easily... presumably the interest is being paid gross i.e. a R85 has been filled in

isofa

Just find a better rated account, I certainly wouldn't mess about with a pension.

Ensure she is receiving gross interest too, as per Clapton's post.

Top rated accounts listed at Moneyfacts.

Gymgenius

My girls' portfolio includes a Treasure Bond from YBS - which is currently paying 5.5%. Theirs were secured at 6.3% though.

penguine

CLAPTON wrote: »

she must be 16 before she can have an ISA

If you set up a CTF it can be rolled into an ISA in her name when she's older. Maximum that can be deposited in any year is £1200. If I remember correctly this is not per tax year but per year ending on the child's birthday, so if she has a birthday coming up in the next few months you can move £1200 in now then £1200 right after the bday for the following year. The highest paying one at the moment is 7%, part of that being a 1.25% bonus for 2 years.

www.moneysavingexpert.com/savings/child-trust-fund-vouchers

baby_boomer

I ignore children's accounts for my offspring whose savings average way over 6.5%.

Search MoneyFacts for fixed rate accounts and include your child's age in the search and they will come up with the best solution.